Appendix A - Glossary of Common Insurance Terms

Cancellation - Termination of policy during the policy term.

Claim - A request for reimbursement for a loss covered by a policy. For example, a claim for lost deposits in the event the wedding is cancelled due to a covered event.

Exclusion - Certain causes and conditions listed in the policy that are not covered.

Independent Agent - An agent who represents more than one insurer.

Insurance - A formal device for reducing an insured's potential costs by transferring specific risks to insurance companies.

Premium - The amount of money an insurance company charges, based on a given rate, to provide the coverage described in the policy for a specified period of time, generally one year.

Underwriting - The process of examining, accepting or rejecting insurance risks, and classifying those selected, in order to charge the proper premium for each.

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